TECHNICAL EFFICIENCY OF SHRIMP FARMERS IN BANGLADESH: A STOCHASTIC FRONTIER PRODUCTION FUNCTION ANALYSIS

This study examines the technical efficiency of shrimp farmers of south-eastern and south-western Bangladesh. Farm level data were collected from 155 farmers taking into account three farming methods viz extensive, improved extensive and semi-intensive. Stochastic production frontiers are estimated for shrimp in two regions of Bangladesh. Sources of yield variations, i.e., production input, technical efficiency and other factors in all the three methods are investigated in this study. Factors affecting technical inefficiency are also analyzed simultaneously with the production frontiers using maximum likelihood method by Frontier 4.1 program. The study showed that 85%, 61% and 87% variation respectively in output among the farming methods in shrimp cultivation is due to differences in technical efficiency. Land, fry and feed have significant influence on the level of shrimp production. Varying from 0.56 to 1.00 the mean technical efficiency was found to be 0.82, 0.85 and 0.93 respectively in extensive, improved extensive and semi-intensive farming methods.